Businessweek makes big-government backers’ case for targeting corporate tax havens

If you read Bloomberg Businessweek‘s recent reporting on state efforts to target corporate tax havens, you might want to balance that presentation with some alternative viewpoints … including those of the Cato Institute and the John Locke Foundation’s primary fiscal policy analyst.

Being aware of what other states are doing will help North Carolina be more competitive for business investment. You notice from the above chart that Southeastern states do not require corporations to file a combined report, and are thus unable to tax offshore earnings. Over the last 10 years, we have seen states in the Southeast lowering their corporate income tax rates, and with that, more businesses are moving to these states. The good thing is that, with more and more states in the West and Northeast including these offshore profits in their corporate income tax rates, more businesses will leave those states and come to states like North Carolina.

Corporations want to make money, not face additional taxation. They will relocate to areas that have a less complicated tax code and lower tax rates. According to a John Locke Foundation Spotlight by Dr. Roy Cordato:

The corporate income tax is based on the myth that corporations actually pay taxes. In fact, corporations not only do not pay taxes, they cannot pay taxes. All taxes “paid” by a corporation must come out of real people’s wallets or bank accounts. These real people are shareholders, employees, and customers.

So the answer is NO. States should not collect state corporate income taxes from offshore accounts. But if states do decide to do this, then North Carolina will reap the benefit with a lower tax rate and simpler tax code.

New Carolina Journal Online features

Karen McMahan reports for Carolina Journal Online on the Democratic primary in N.C. House District 60.

Jon Sanders’ Daily Journal focuses on a University of North Carolina professor who’s leading the charge for free speech and academic freedom.

You might be a ‘progressive’ if …

… you interrupt your handwringing over the neologism “food deserts” just long enough to become incensed when an entrepreneur creates a food oasis.

… if, in other words, both of these make sense to you:

  • If poor people are not within a reasonable distance from an affordable grocery store, it is because capitalism is heartless and doesn’t care to serve poor, underprivileged people, and we call it a “food desert.”
  • If poor people are within a reasonable distance from an affordable grocery store, or if an affordable grocery store is proposed within a reasonable distance, it is because capitalism is heartless and seeks to use their poverty and limited mobility against them, and we call it “exploitation.”

Leef’s latest Forbes column responds to flawed Pew report

George Leef explains for Forbes readers why a new Pew Research report misses the mark in estimating the impact of a college degree.

In February, Pew Research released a study on the effects of college but the instant I saw the title, I was sure that this would not be one that broke out of the usual “college is a great investment” model. That study, “The Rising Cost of Not Going to College,” actually moves further in the wrong direction by telling people that those who don’t go to college are penalizing themselves.

The many “college is a great investment” papers present statistics showing that, on average, individuals who have college educations earn more than do people without them. They left the conclusion, “If you aren’t planning on college, you really should,” implicit.

Pew, however, makes that explicit. “If you don’t go to college, you’ll lose out big time” is the message it sends.

What makes that message particularly distressing is the fact that more and more young Americans who have their college degrees are unable to find jobs they couldn’t have gotten straight out of high school—or maybe even while still in high school. They’re often struggling with large college debts. And yet this study tells them that going to college is more important than ever.

Pew proclaims that its research is “non-partisan and non-advocacy” but they don’t say that it’s “non-misleading.” This study is very misleading and if young Americans take it seriously, many will go to college just because they think that not going would be a self-inflicted penalty.

Another “progressive” administration at work, 100 years ago

A century ago, Woodrow Wilson ordered the US Navy to attack and seize Veracruz, Mexico. New York Times writer Enrique Krauze writes about that bit of bloody aggression here.

Sometimes “progressives” stumble upon the truth

Matt Breunig is a progressive who has recently completed law school and in this piece he makes a sound argument against the strictly regulated entrance requirements for the legal profession, in particular the law school mandate.

Remarkably, Breunig grasps that regulation of entry does not lead to higher quality practitioners, but merely drives up costs. Maybe he’ll eventually figure out that most governmental regulations serves purposes other than those they’re supposed to.

He also understands that some prominent leftists (such as law school deans) are profiting handsomely from a system that is detrimental to the poor.

Allan Meltzer argues for opportunity rather than envy

The great monetary economist Allan Meltzer writes here about the recent brouhaha over the redistributionist tome by Thomas Piketty and argues that the world would be far better off by ignoring its seductive call for government redistribution and instead had government get out of the way — that is, stop interfering with efforts to help the poor through voluntary action and to stop interfering with their own efforts by government policies.

Why government keeps growing

Economics professor Richard Ebeling explains why government continues to grow apace in this essay.

Is there a solution? Ebeling writes, “It is neither an easy nor a quick task to change, in this sense, the ‘climate of opinion’ about the appropriate moral order to sustain a free, prosperous and ethically healthy society. But we have no tools other than our minds and our reason and an understanding that it is in our own self-interests to try.”

I agree entirely. The moral order of the United States has become increasingly accommodating to the kind of legal plunder that Bastiat warned about and the Founders tried to prevent by writing the Constitution as they did with strict limits on governmental power.